Wed | Sep 20, 2017

Trump can't dissolve foundation during investigation

Published:Wednesday | December 28, 2016 | 12:00 AM
United States President-elect Donald Trump.

Donald Trump cannot move ahead with his plan to dismantle his charitable foundation because state prosecutors are probing whether the president-elect personally benefited from its spending, the New York attorney general's office said Tuesday.

"The Trump foundation is still under investigation by this office and cannot legally dissolve until that investigation is complete," said Amy Spitalnick, spokeswoman for state Attorney General Eric Schneiderman.

The statement came after Trump announced that he wanted to dissolve the Donald J. Trump Foundation, part of what his presidential transition team says is an effort to erase any potential conflicts of interest before he takes office January 20.

But the foundation's inner workings have been the subject of Schneiderman's investigation for months and could remain a thorny issue for Trump's incoming administration. Democrats nationally have said they are ready to raise any legal or ethical issues from Trump's global business empire during his presidency.

Trump's charity has admitted that it violated IRS regulations barring it from using its money or assets to benefit Trump, his family, his companies or substantial contributors to the foundation.

SPENDING REVELATIONS

The admissions by the Donald J. Trump Foundation were in a 2015 tax filing made public after a presidential election in which it was revealed that Trump has used the charity to settle lawsuits, make a $25,000 political contribution and purchase items, such as a painting of himself, that was displayed at one of his properties.

The 2015 tax filing was posted on the non-profit monitoring website GuideStar on November 18 by someone using an email address from the foundation's law firm, Morgan, Lewis & Bockius, said GuideStar spokeswoman Jackie Enterline Fekeci.

In the tax filing, the foundation acknowledged that it used money or assets in violation of the regulations not only during 2015, but in prior years. But the tax filing doesn't provide details on the violations.

Schneiderman, a Democrat, launched his investigation into the charity after reporting by The Washington Post drew attention to some of the foundation's purchases.

Trump asserted on Twitter late Monday that his foundation was run efficiently.

"The DJT Foundation, unlike most foundations, never paid fees, rent, salaries or any expenses," the president-elect tweeted. "100% of the money goes to wonderful charities."

In an evening post, he wrote that he believes his election as president has boosted the economy.

"The world was gloomy before I won there was no hope," he tweeted. "Now, the market is up nearly 10 per cent and Christmas spending is over a trillion dollars."

MARKET INCREASE

Markets are up since Trump won the general election, although not by that much. The Standard & Poor's 500 is up about six per cent since election day, while the Dow has risen more than eight per cent.

As for holiday spending, auditing and accounting firm Deloitte projected in September that total 2016 holiday sales were expected to exceed $1 trillion, representing a 3.6 per cent to 4.0 per cent increase in holiday sales from November through January. But that can't be credited to Trump because the projection came before the election.

- AP